SORTED GROUP HOLDINGS PLC — Interim / Quarterly Report 2015

Mar 23, 2016

Date of Announcement: 23 March 2016 Reference: 84/2016

The following is a Company Announcement issued by Island Hotels Group Holdings plc pursuant to the Malta Financial Services Authority Listing Rules.

Quote

The Board of Directors of Island Hotels Group Holdings p.l.c. (the Company) has met on 23rd March 2016 to review the Audited Consolidated Financial Statements for the 14-month financial period ended 31st December 2015.

A Preliminary Statement of Results for this period is attached to this Company Announcement and is available for public viewing on the Company's website at www.islandhotels.com, or at the Company's registered address at Radisson Blu Resort St. Julians, Louis V. Farrugia Street, St George's Bay, St. Julians.

The directors do not propose the payment of a dividend for the year ending 31st December 2015 (2014 – Nil).

Unquote

Signed:

Kenneth Abela Company Secretary

_____________________

Statements of profit and loss

Period ended 31 December 2015

	Group			Holding
	2015	2014	2015	2014
	14 months	12 months	14 months	12 months
	€	€	€	€
Continuing operations
Revenue	24,411,507	15,835,762	-	-
Staff costs	(9,875,610)	(6,212,769)	-	-
Food and beverage costs	(4,361,648)	(1,963,641)	-	-
Other operating costs	(7,835,782)	(5,123,206)	(221,020)	(168,484)
Other operating income	-	-	172,153	152,465
Earnings/(loss) before interest,	——————	——————	——————	——————
taxation, depreciation and amortisation	2,338,467	2,536,146	(48,867)	(16,019)
Property, plant and equipment written off	(897,977)	-	-	-
Depreciation and amortisation	(2,680,041)	(1,174,997)	-	-
	——————	——————	——————	——————
Operating (loss)/ profit	(1,239,551)	1,361,149	(48,867)	(16,019)
Share of profits from joint ventures	3,442,875	2,802,158	-	-
Investment income	5,304,422	322,786	4,420,730	2,490,714
Other expenses	(288,701)	-	-	-
Finance costs	(4,284,630)	(2,897,650)	(3,764,828)	(2,277,218)
Profit before tax	—————— 2,934,415	—————— 1,588,443	—————— 607,035	—————— 197,477
Income tax credit/(expense)	490,653	(58,372)	(182,790)	(67,986)
	——————	——————	——————	——————
Profit for the period
from continuing operations	3,425,068	1,530,071	424,245	129,491
Discontinued operations
Profit for the period from
discontinued operations	-	1,202,385	-	-
	——————	——————	——————	——————
Profit for the period	3,425,068 ——————	2,732,456 ——————	424,245 ——————	129,491 ——————
Profit for the period
attributable to the
owners of the
holding company	3,425,068	2,732,456	424,245	129,491
	=========================	=========================	=========================	=========================
Basic/diluted earnings per
share from continuing
operations	0.091	0.042
Basic/diluted earnings	=========================	=========================
per share from continuing
and discontinued operations	0.091	0.075
	=========================	=========================

Island Hotels Group Holdings p.l.c.

Registered Address: Radisson Blu Resort St. Julians, Louis V. Farrugia Street, St. George's Bay, St. Julians STJ 3391, Malta

Telephone: +356 2137 4894

Company Registration No.: C44855

Island Hotels Group Holdings p.l.c. is a public limited company registered in terms of the Companies Act (Cap.386 of the Laws of Malta) - 2 -

Statements of profit and loss and other comprehensive income

Period ended 31 December 2015

2015 14 months €	Group 2014 12 months €	2015 14 months	Holding 2014 12 months
		€	€
	2,732,456	424,245	129,491 ——————
	- -	- -	- -
	1,437,025	-	-
	1,437,025 ——————	- ——————	—————— - ——————
	4,169,481	424,245	129,491 =========================
			129,491
	3,425,068 —————— 10,542,188 (3,689,766) 1,402,945 —————— 8,255,367 —————— 11,680,435 ========================= 11,680,435	—————— —————— ========================= 4,169,481 ========================= =========================	—————— —————— ========================= 424,245 =========================

Island Hotels Group Holdings p.l.c.

Registered Address: Radisson Blu Resort St. Julians, Louis V. Farrugia Street, St. George's Bay, St. Julians STJ 3391, Malta

Telephone: +356 2137 4894

Company Registration No.: C44855

Island Hotels Group Holdings p.l.c. is a public limited company registered in terms of the Companies Act (Cap.386 of the Laws of Malta) - 3 -

Statements of financial position

31 December 2015

	Group 2015 2014		2013	2015	Holding 2014
	€	€	€	€	€
ASSETS AND LIABILITIES Non-current assets
Goodwill	11,020,822	11,020,822	11,020,822	-	-
Other intangible assets	9,329,631	-	-	-	-
Property, plant and equipment	66,347,712	27,846,368	41,849,252	-	-
Investments in subsidiaries	-	-	-	56,214,167	52,801,199
Investment in associates Investments in joint ventures	300 39,770,036	- 37,862,919	- 33,571,672	- 16,000,000	- 17,314,460
Loans and receivables	828,719	7,392,920	8,349,830	26,258,886	11,024,760
Other cash at bank	74,189	137,327	-	-	-
	—————— 127,371,409 ——————	—————— 84,260,356 ——————	—————— 94,791,576 ——————	—————— 98,473,053 ——————	—————— 81,140,419 ——————
Current assets
Inventories	925,259	311,626	710,447	-	-
Trade and other receivables	8,497,916	14,815,784	15,294,376	544,458	5,659,121
Loans and receivables	6,452,279	4,360	94,264	6,118,908	198,272
Current tax asset	295,541	319,199	217,734	243,752	242,463
Cash and cash equivalents	1,534,251	20,304,663	305,675	237,987	19,583,881
Other cash at bank	63,137 ——————	211,349 ——————	- ——————	- ——————	- ——————
	17,768,383 ——————	35,966,981 ——————	16,622,496 ——————	7,145,105 ——————	25,683,737 ——————
Total assets	145,139,792 =========================	120,227,337 =========================	111,414,072 =========================	105,618,158	106,824,156 ========================= ============================
EQUITY AND LIABILITIES Equity attributable to the owners of the holding company
Share capital	38,583,660	36,583,660	36,583,660	38,583,660	36,583,660
Revaluation Reserve	6,852,422	-	-	-	-
Currency translation reserve	2,925,167	1,522,222	85,197	-	-
Retained earnings / (Accumulated losses)	5,691,883	2,266,815	(465,641)	1,057,920	633,676
Total equity	—————— 54,053,132 ——————	—————— 40,372,697 ——————	—————— 36,203,216 ——————	—————— 39,641,580 ——————	—————— 37,217,336 ——————

Island Hotels Group Holdings p.l.c.

Registered Address: Radisson Blu Resort St. Julians, Louis V. Farrugia Street, St. George's Bay, St. Julians STJ 3391, Malta

Telephone: +356 2137 4894

Company Registration No.: C44855

Island Hotels Group Holdings p.l.c. is a public limited company registered in terms of the Companies Act (Cap.386 of the Laws of Malta) - 4 -

Statements of financial position (continued)

31 December 2015

	Group			Holding
	2015	2014	2013	2015	2014
	€	€	€	€	€
Non-current liabilities Bank loans Other financial liabilities Trade and other payables Deferred tax liabilities	3,760,906 53,311,255 858,744 11,647,815 —————— 69,578,720	12,146,596 48,785,597 2,032,568 4,205,883 —————— 67,170,644	21,581,139 16,888,083 4,001,893 7,202,659 —————— 49,673,774	- 62,052,966 - - —————— 62,052,966	5,668,392 61,967,568 - - —————— 67,635,960
Current liabilities Trade and other payables Bank overdrafts and loans Current tax liabilities Other financial liabilities	—————— 15,085,359 4,170,018 226,716 1,724,133 —————— 21,206,226	—————— 8,603,549 2,556,496 - 1,254,729 —————— 12,414,774	—————— 12,537,656 9,819,510 24,544 3,155,372 —————— 25,537,082	—————— 1,834,172 - - 2,089,440 —————— 3,923,612	—————— 1,230,077 740,783 - - —————— 1,970,860
Net Liabilities in joint ventures classified as held for sale Total liabilities	—————— 301,714 —————— 91,086,660 ——————	—————— 269,222 —————— 79,854,640 ——————	—————— - —————— 75,210,856 ——————	—————— - —————— 65,976,578 ——————	—————— - —————— 69,606,820 ——————
Total equity and liabilities	145,139,792 =========================	120,227,337 =========================	111,414,072 =========================	105,618,158	106,824,156 ========================= ============================

Island Hotels Group Holdings p.l.c.

Registered Address: Radisson Blu Resort St. Julians, Louis V. Farrugia Street, St. George's Bay, St. Julians STJ 3391, Malta

Telephone: +356 2137 4894

Company Registration No.: C44855

Island Hotels Group Holdings p.l.c. is a public limited company registered in terms of the Companies Act (Cap.386 of the Laws of Malta) - 5 -

Statement of changes in equity - Group

Period ended 31 December 2015

Group

Equity attributable to the owners of the holding company

Share capital €	Revaluation reserve €	Currency translation reserve €	(Accumulated losses)/ Retained earnings €	Total €
36,583,660 ——————	——————	85,197 ——————	(465,641) ——————	36,203,216 ——————
- -	- -	- 1,437,025	2,732,456 -	2,732,456 1,437,025
-	-	1,437,025	2,732,456	—————— 4,169,481
36,583,660	-	1,522,222	2,266,815	—————— 40,372,697
2,000,000	-	-	-	—————— 2,000,000
-		-	3,425,068	—————— 3,425,068
-	6,852,422	1,402,945	-	8,255,367
-	6,852,422	1,402,945	3,425,068	—————— 11,680,435
38,583,660	6,852,422	2,925,167	5,691,883	—————— 54,053,132 ============================
	—————— —————— —————— —————— —————— —————— =========================	—————— —————— —————— —————— —————— —————— =========================	—————— —————— —————— —————— —————— —————— =========================	—————— —————— —————— —————— —————— —————— =========================

Island Hotels Group Holdings p.l.c.

Registered Address: Radisson Blu Resort St. Julians, Louis V. Farrugia Street, St. George's Bay, St. Julians STJ 3391, Malta

Telephone: +356 2137 4894

Company Registration No.: C44855

Island Hotels Group Holdings p.l.c. is a public limited company registered in terms of the Companies Act (Cap.386 of the Laws of Malta) - 6 -

Statement of changes in equity – Holding company

Period ended 31 December 2015

Holding company

	Share capital €	Retained earnings €	Total €
Balance at 31 October 2013	36,583,660	504,185	37,087,845
	——————	——————	——————
Profit/total comprehensive income	-	129,491	129,491
for the year	——————	——————	——————
Balance at 31 October 2014	36,583,660	633,676	37,217,336
	——————	——————	——————
New Issue of ordinary shares	2,000,000	-	2,000,000
	——————	——————	——————
Profit/total comprehensive income	-	424,244	424,244
for the period	——————	——————	——————
Balance at 31 December 2015	38,583,660	1,057,920	39,641,580
	==========================	=========================	============================

Island Hotels Group Holdings p.l.c. Registered Address: Radisson Blu Resort St. Julians, Louis V. Farrugia Street, St. George's Bay, St. Julians STJ 3391, Malta Telephone: +356 2137 4894 Company Registration No.: C44855

Island Hotels Group Holdings p.l.c. is a public limited company registered in terms of the Companies Act (Cap.386 of the Laws of Malta) - 7 -

Statements of cash flows

Period ended 31 December 2015

	Group			Holding
	2015	2014	2015	2014
	€	€	€	€
	14 months	12 months	14 months	12 months
Cash flows from operating activities
Profit before tax from:
Continuing operations	2,934,415	1,588,443	607,034	197,477
Discontinued operations	-	789,559	-	-
Profit before tax	—————— 2,934,415	—————— 2,378,002	—————— 607,034	—————— 197,477
Adjustments for:
Depreciation and amortisation	2,680,041	1,374,852	-	-
Bad debts written off	(3,624)	-	-	-
Property, plant and equipment written off	897,977	-	-	-
Profit on disposal of property,
plant and equipment	(7,485)	(2,685)	-	-
Share of profits from joint ventures	(3,442,875)	(2,802,158)	-	-
Gain on disposal of subsidiary	-	(1,975,400)	-	-
Investment income	(5,304,422)	(322,786)	(1,149,227)	(340,330)
Other expenses	288,701	-	-	-
Dividend income	-	-	(3,271,503)	(2,150,384)
Interest expense	4,284,630	2,897,650	3,764,828	2,277,218
	——————	——————	——————	——————
Operating profit/(loss) before
working capital movements	2,327,358	1,547,475	(48,868)	(16,019)
Movement in inventory	(200,999)	390,899	-	-
Movement in trade and other receivables	9,824,750	214,688	5,114,663	(1,419,656)
Movement in trade and other payables	(1,135,647) ——————	(3,731,652) ——————	604,096 ——————	801,945 ——————
Cash flows from operations	10,815,462	(1,578,590)	5,669,891	(633,730)
Interest paid	(4,199,230)	(2,867,150)	(3,679,428)	(2,277,218)
Taxation refunded/(paid)	66,710	(53,108)	(184,079)	(193,347)
Net cash flows from operating activities	—————— 6,682,942	—————— (4,498,848)	—————— 1,806,384	—————— (3,104,295)
	——————	——————	——————	——————
Cash flows from investing activities
Purchase of property, plant and equipment	(4,234,821)	(2,158,213)	-	-
Purchase of intangible assets	(339,600)	-	-	-
Proceeds from sale of property,
plant and equipment	7,685	64,028	-	-
Net cash flow on acquisition of subsidiary	(1,799,028)	-	(98,508)	-
Net cash flow on disposal of subsidiary	-	5,660,788	-	-
Movement in loans and other receivables	455,832	1,046,814	(21,154,763)	(6,729,420)
Other cash at bank held as guarantee	211,349	(348,676)	-	-
Dividends received	1,490,215	-	3,271,503	2,150,384
Interest received	277,109	322,786	1,149,227	340,330
Net cash flows from investing activities	—————— (3,931,259)	—————— 4,587,527	—————— (16,832,541)	—————— (4,238,706)
	——————	——————	——————	——————

Island Hotels Group Holdings p.l.c.

Registered Address: Radisson Blu Resort St. Julians, Louis V. Farrugia Street, St. George's Bay, St. Julians STJ 3391, Malta

Telephone: +356 2137 4894

Company Registration No.: C44855

Island Hotels Group Holdings p.l.c. is a public limited company registered in terms of the Companies Act (Cap.386 of the Laws of Malta) - 8 -

Statements of cash flows (continued)

Period ended 31 December 2015

	Group 2015 2014		2015	Holding 2014
	€	€	€	€
	14 months	12 months	14 months	12 months
Cash flows from financing activities
Movement in bank loans	(10,536,733)	(5,150,044)	(6,409,174)	(4,425,478)
Proceeds from issue of bond	-	34,268,021	-	-
Movement in related party balances	(12,926,963)	(3,704,071)	2,089,438	31,329,595
Movement in obligations under finance lease	(40,851)	305,635	-	-
Net cash flows from financing activities	—————— (23,504,547)	—————— 25,719,541	—————— (4,319,736)	—————— 26,904,117
Net movement in cash and cash	——————	——————	——————	——————
equivalents Cash and cash equivalents at the	(20,752,864)	25,808,220	(19,345,893)	19,561,116
beginning of the period/year	19,283,341	(6,524,879)	19,583,881	22,765
Cash and cash equivalents at the end of the period/year	—————— (1,469,523)	—————— 19,283,341	—————— 237,988	---—————— 19,583,881
	=======================	=======================	=======================	=========================

Island Hotels Group Holdings p.l.c.

Registered Address: Radisson Blu Resort St. Julians, Louis V. Farrugia Street, St. George's Bay, St. Julians STJ 3391, Malta

Telephone: +356 2137 4894

Company Registration No.: C44855

Island Hotels Group Holdings p.l.c. is a public limited company registered in terms of the Companies Act (Cap.386 of the Laws of Malta) - 9 -

Commentary on the Financial Statements for the 14-month period ended 31 December 2015

Background

The Group's business remains unchanged and comprises the ownership and operation of hotels in Malta, the provision of accommodation, catering and related services locally and the provision of retail catering mainly through the Costa franchise in Malta, the East coast of Spain and the Balearic Islands. The Group is made up of a holding Company that acts as an investment company, together with its subsidiaries and joint venture entities. The Group's equity is ultimately owned by International Hotel Investments p.l.c.

Review of Business

The results of the Group in this preliminary statement represent the results of the holding Company together with those of its subsidiaries and its share of joint venture entities for the 14-month period ended 31st December 2015.

During the period under review, the application of IFRS 11 became compulsory and therefore the proportionate line by line consolidation that used to apply in previous reporting periods is now no longer allowable, with the equity method of reporting becoming applicable. The results reported in the year ended 31st October 2014 have been restated to report a comparable position.

During this 14-month period under review, two significant events occurred that had a substantial effect on the Company's Financial Statements, namely the purchase of the remaining 50% shareholding in Buttigieg Holdings Limited (June 2015) and the purchase of the remaining 50% shares in The Heavenly Collection Limited (end of December 2015). These latter two companies have now become fully owned subsidiaries of Island Hotels Group Holdings plc and their results were, effective from the date of acquisition, consolidated in full within the operational results of the Group. Buttigieg Holdings Limited incorporates within it the Costa operation in both Malta and Spain, the Mater Dei customer canteen contract and other ancillary operations, whereas The Heavenly Collection Limited is the company owning circa 85,000 sqm of land formerly known as Hal Ferh, that includes a full development permit, and which is situated next to Golden Bay.

The results of the Buttigieg Holdings Group from 1st November 2014 up to 31st May 2015 have been reported within the line "Share of profits from Joint Ventures", whereas the results from 1 st June 2015 to 31st December 2015 are consolidated in the Group's results once Buttigieg Holdings Group became a fully owned subsidiary of the Company. This is in fact the main reason behind the considerable changes in the figures up to EBITDA level when the relevant line item figures are compared to those reported in 2014. The other reason is that we are reporting a 14-month period in these financial statements as compared to a 12-month one reported last year.

Relevant to point out also is the line item "Investment income" which includes the profit registered from the stepped acquisition of both transactions reported above. The net profit before tax from continuing operations amounted to €3,425,068.

Island Hotels Group Holdings p.l.c.

Registered Address: Radisson Blu Resort St. Julians, Louis V. Farrugia Street, St. George's Bay, St. Julians STJ 3391, Malta

Telephone: +356 2137 4894

Company Registration No.: C44855

Island Hotels Group Holdings p.l.c. is a public limited company registered in terms of the Companies Act (Cap.386 of the Laws of Malta) - 10 -

In so far as trading results for the Group are concerned, the record number of tourist arrivals in Malta in 2015 have had a positive effect on the Group's results. Despite the fact that the Radisson Blu Resort, St. Julians closed for refurbishment between November 2014 and March 2015, and notwithstanding the fact that the catering operation at the Coastline Hotel was limited to eight months' trading in the period under review because of refurbishment works undertaken by the new owners of the hotel, the results reported by the Group have once again been very satisfactory.

The new product on offer at the Radisson Blu Resort, St. Julians, along with the increased tourist arrivals as well as the Group's own revenue management efforts resulted in higher occupancy levels and rates in this hotel. The Group also experienced a higher level of Vacation Ownership sales which resulted in higher profits being generated by this operation.

An increase in the volume of activity in the event catering area of the business was also registered, whilst the Costa Coffee outlets in Malta have continued to increase both their revenues and operating profit, further consolidating the potential expected from this investment. This area of the business also includes the results of the start-up operation in Spain where the Group opened an additional 9 stores during the period under review.

As stated in the narrative above, during the period under review, International Hotel Investments plc, made an offer for the entire shareholding of the Company and, as announced in various Company Announcements, acquired the entire share capital of the Company on the 4th of September 2015.

In terms of Listing Rule 5.54.6, the annual results of the Company and the Group for the period ended 31st December 2015 contained within this Company Announcement have been agreed with the Group's auditors.

END